Headline rates of inflation across most of the world’s economies have fallen back sharply since the autumn but core rates — which exclude volatile categories such as energy and food — remain at or close to multi-decade highs.
These rates, seen as a better gauge of underlying price pressures, have sparked concern that central banks will struggle to hit their targets without wiping out growth.
“The next leg of the improvement in the inflation numbers is going to be harder,” said Carl Riccadonna, chief US economist at BNP Paribas. “It requires more pain, and that pain likely involves a recession in the back half of the year.”
Torsten Slok, chief economist at Apollo Global Management, added: “The only way to get inflation down to 2 per cent is to crush demand and slow down the economy in a more substantial way.”
“The next leg of the improvement in the inflation numbers is going to be harder. It requires more pain:” BNP's Riccadonna
Apollo's Torsten Slok: “The only way to get inflation down to 2% is to crush demand.”
https://t.co/8BVmtH9pdm— Lisa Abramowicz (@lisaabramowicz1) June 23, 2023